This is a fully integrated system that is applicable to credit risk, market risk, operational risk, liquidity and interest rate risk, hedge accounting risk, portfolio modeling, fund transfer pricing, etc. While costs are past expenses that can be easily determined, risks are future costs which organizations are potentially exposed to but there occurrence and resultant cost cannot be determined with certainty. Occurrence of risks can result in untold costs to the firm. This therefore necessitates the use of this software to look out for risks.
The risk management system is tasked with identifying and assessing the prevailing risk situation with an enterprise-wide view. Together with a risk register that shows the risks drivers of an organization, their impact and probability of occurrence, this software provides a lasting solution to risk management.
The system works by outlining clearly significant risks facing the firm and the most appropriate treatment measures aimed at mitigating the likelihood of materialization of those risks and their respective repercussion. This can be presented on graphs using charts or as a management report.
The software integrates risk management tasks from various departments of the organization into an enterprise-wide view. For instance, the software may be integrated with control self-assessment that scrutinizes and ratifies controls to find out whether they are operating as per the set standards for optimal results. It could also be consolidated with issue manager that seeks to iron out differences that create a divergence between the organization’s actual performance and the stakeholders’ expectations. This allows for an enterprise view on risks which can be exhibited on several charts to show their correlation and appropriate mitigation measures.
Uncertainties are properly managed by ensuring that unforeseen risks are kept under control at all times. This could be achieved by avoidance of the risk or transferring the impact of the risk to a third party or maybe an insurance firm. This way the optimal organization goals are adequately protected. This would not have been possible without the risk assessment and risk treatment capabilities of the credible risk management system. However, this is not the end. It is of paramount importance that the risk management efforts are constantly monitored and reviewed.
This way, pending treatments are executed on time while past assessments and treatments are surveyed to ensure their continued viability. The risk management system is able to communicate with the end users through alerts regarding assessments, treatments and reminders for expected treatments. The same information is relayed via email too. This is a unique characteristic of this system. Besides, enterprise risk management is a corporate regulatory requirement.
There is no questioning; this software gives you a chance to make responsible, informed and justifiable decisions with regard to risk management. Luckily, this works for firms of all sizes and from all industries. For instance, proactive operational risk management procedures facilitate positive events and duly mitigate deplorable events. Thus, the enterprise risk management system identifies, analyzes, monitors, responds to and mitigates risks in an enterprise wide view. This entails taking up risk management with the day to day operations of the organization for the desired results and hence unrivaled growth.